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A Comprehensive Guide to Foreign Company Registration and Commercial Licensing in Saudi Arabia

Saudi Setup Practical Guides

31 May 2024

Maha Anwar

Saudi Arabia's strategic location and business-friendly reforms attract high-growth companies. Securing a commercial license unlocks significant benefits and incentives, read more to find out how you can register and license your foreign company in Saudi.

Saudi Arabia’s strategic location, wide-ranging, sector-specific reforms, and thriving business landscape make it a magnet for high-growth companies with international business scope.

Obtaining a one-year commercial license is a critical first step for any business venturing into the Saudi market, providing legal legitimacy for business operations while unlocking a wealth of benefits and incentives offered by the Saudi government.

Staying on top of Saudi Arabia's licensing process is crucial for smooth business expansion and establishing a legitimate and compliant business process.

Benefits of Having a Commercial License

  • Securing a legal right to conduct commercial activities in Saudi Arabia.
  • Providing unprecedented access to incentives, services, and intellectual property protection.
  • Enhanced access to more contracts and tendering opportunities.

Steps to a Foreign Company Registration Process

Required Documents

  1. Certificate of incorporation.
  2. A financial statement, memorandum of association and article of association.
  3. Notarizing a power of attorney (POA) document from a public notary.

Process for Setting Up a Company in Saudi

Stage 1: Foundations of the Legal Entity (Projected timeline: 1 month)

1. Obtain a MISA Investor License

2. Name Reservation

3. Draft Local Articles of Association (AoA)Insight: The Articles of Association template is set up by law and companies are only able to adjust their general manager’s powers.

4. Commercial Registration (CR)

5. Chamber of Commerce (CoC) Registration

Stage 2: Authorization to Hire Staff (Projected timeline: 2 months)

6. Obtain a Company seal

7. Register with The Ministry of Labor

8. Register with the General Organization for Social Issuance (GOSI)

9. Register a National Address

10. Issue a GM Visa

11. Registration with the General Authority of Zakat and Tax (GAZT) and VAT Registration

Stage 3: Acquiring Residency and Opening a Bank Account (Projected timeline: 3 months)

12. Activate the Chamber of Commerce (CoC) Account

13. Obtain Health Insurance

14. Get a Medical Check-up

15. Issuing the GM’s Iqama

16. Register with the Muqeem portal for streamlined visa and residency management

17. Register with the Absher portal for an array of e-government services

18. Register with the Qiwa portal for business services designed for SMEs

19. Register with the Mudad Portal to manage essential municipal services for your company

20. Open a Bank account

Most Common Types of Business Licenses Offered by MISA to Foreign Companies across Diverse Sectors

  • Service License: A service license grants full ownership (100%) to foreign companies in sectors like construction, technology, education, healthcare, and tourism.
  • Entrepreneurial License: The entrepreneurial license offers streamlined regulations, reduced fees, and government support programs.
  • Industrial License: In Saudi Arabia, an industrial license grants full ownership (100%) to foreign investors for setting up manufacturing facilities, in line with the broader Vision 2030 objective to transform the Kingdom into a leading industrial powerhouse and a global logistics hub.
  • Agricultural License: Saudi Arabia's agricultural license allows foreign companies full ownership (100%) in farming and livestock, boosting food production and aligning with Vision 2030's goals of food security and 85% food localization.
  • Real Estate License: Foreign firms can apply for a real estate license for projects exceeding SAR30 million and located outside the holy cities of Mecca and Medina.
  • Trading/Commercial License: Saudi Arabia's Trading License offers foreign investors two paths: 100% ownership for wholesale/retail trade or partnership with a local shareholder. Comm
  • Mining License: Saudi Arabia's mining license grants foreign companies full ownership (100%) of mining ventures.
  • Professional License: Saudi Arabia's Professional License lets foreign professionals own and run businesses in law, consulting, engineering, and similar fields (100% ownership).

Learn more about all types of licenses here.

Ensuring successful compliance with the country's industry-specific norms and regulations established a firm foundation for long-term economic prosperity in Saudi Arabia’s growing economy.

Fostering local partnerships with setup specialists has proven to be paramount in helping businesses navigate the intricacies of the market's ever-evolving conditions, positively influencing the growth prospects of incoming firms that beckon the country as their next destination of choice.

Ready to expand to Saudi? Contact AstroLabs today.

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